Monday, February 18, 2013

Boom! Descriptive fair use defense can't be decided on motion to dismiss

Tovey v. Nike, Inc., 2012 WL 7017821 (N.D. Ohio)

Showing that “use as a mark” is a flexible but occasionally
very thin reed, the magistrate judge here recommended denial of Nike’s motion
to dismiss many of Tovey’s trademark claims.Tovey pled that he attended class at Hondros College with LeBron James’
girlfriend, Brinson, when James had a sponsorship agreement with Nike.He conceived of a line of sports clothing with
the tagline, “BOOM YO” and marketed around “game changing sports moments.” A “game changing event” would be shown on one
side of each item of clothing with the word “BOOM” on that side.The other side would show an athlete enjoying
that event, along with Yo! He shared his idea with Brinson, hoping to get
Brinson and James to work with him and get Nike to pay royalties to use “BOOM
YO.”

Tovey filed an ITU application for BOOM YO! for clothing in
2005, which was issued in 2009.In 2010,
James posted “LeBron BOOM! SAY BOOM—www.youtube.com—BOOM! This is what epic,
gamechanging moments look like. Experience them now atNike.com” on his Facebook
page.This linked to a video whose page included
the text, “BOOM! This is what epic, game-changing moments look like. Experience
them now at Nike.” Tovey alleged that
Nike rolled out a campaign employing the same concept of game-changing moments
he discussed with Brinson, and his friends allegedly asked if he’d made an
agreement with Nike.The Nike website
said, “WHAT'S YOUR BOOM MOMENT? A BOOM moment is a game changing play. It's a
bottom of the ninth grand slam. It's a fourth quarter pick six. Make yours
known ....”

Nike’s ad firm, WK, said of the campaign:

“Boom” celebrates the epic,
game-changing moments in sport. Moments that are so over the top that all we
can say is “Boom.” You've probably heard it before and even used it yourself.
The word “boom” has become part of the fabric of popular sports culture. It was
time to have some fun. Nike's Boom campaign features a bevy of Nike elite
athletes and coaches. . . . along with high school football and volleyball
athletes.

Adweek described
the ads as having “the simple theme of ‘Boom!’” Nike used “Boom” on clothing
and in a smartphone app, in various formats, “such as behind a flame above
Manny Pacquiao's initials, behind the liberty bell on a Phillies' shirt,
arranged around two crossed bats on a Texas Rangers t-shirt, in yellow
lettering on a hoodie, behind two opposing helmets below the Tostitos' logo on
a Stanford–Virginia Tech bowl t-shirt, and in split block lettering above ‘AMPLIFY
YOUR TRAINING’ on an advertisement for a smartphone application.”

Tovey alleged confusion with his clothing line, along with
trademark counterfeiting.The judge
recommended dismissal of his counterfeiting claim, because Congress didn’t
intend confusion to count as counterfeiting, which only happens when marks are “substantially
indistinguishable.” Because Tovey didn’t
allege that Nike mimicked a design or color idiosyncratic to “Boom Yo,” and
because the phrases “Boom” and “Boom Yo” weren’t, as a matter of law,
substantially indistinguishable, Tovey failed to plead counterfeiting.

However, the judge recommended against dismissing the basic
infringement claim, despite Nike’s arguments about trademark use/fair use.Even if Tovey didn’t state a plausible claim
based on the use of “Boom” in advertising, he did based on Nike’s use of “Boom”
on clothing.Neither party claimed that
Tovey’s use was uniformly characterized by a particular style of lettering,
colors, etc.Thus, it was plausible that
Nike’s use would create the “possibility” (not “likelihood”?) of confusion by
an unwary consumer.Whether the use of
the swoosh mark would distinguish Nike’s goods from Tovey’s was a question of
fact.Anyway, Tovey argued that the
swoosh gave the impression that Nike was authorized to use Tovey’s trademark,
which would be infringement by sponsorship confusion.

If a defendant isn’t using a mark to identify the source of
its goods, trademark law doesn’t apply.Nike argued that it was using Boom in a non-trademark way, but rather
descriptively.Tovey alleged facts
sufficient to plausibly claim that Nike was using Boom as a mark on clothing,
because the use occurred “without any accompanying context that would indicate
Nike's intent in printing the word on the clothing.”Likewise, as to false designation of origin,
“[w]hether defendants' depictions are merely ‘descriptive’ or are meant to
suggest Tovey's trademark is an issue for the finder of fact.”

As for fair use, that’s a defense that can’t be raised on a
motion to dismiss.In a footnote, the
judge flailed wildly at trademark use (as so many do): use in a non-trademark
way (in its “primary or descriptive sense”) and fair use are similar, but
“legally distinct.”The central issue of
the former is whether the use creates confusion (making it mysterious how this
could be a situation in which trademark law didn’t apply), whereas fair use
asks whether a defendant’s use should be permitted despite confusion.“If a defendant is not using the term to
identify the source of its goods, then it is presumed that there is no
likelihood of confusion, and there is no need for the court to apply the
eight-factor analysis.”By contrast,
fair use can occur along with some degree of confusion.(Note the undertheorized relationship between
a presumption—rebuttable? Irrebuttable? Who knows?—and a defense that allows
some degree of confusion.)

Tovey’s reverse confusion claim wasn’t a separate cause of
action but just a theory of liability.It was dismissed as a separate count, though remained available as an
argument.His secondary liability claims
didn’t fare so well.His pleadings
weren’t clear on who was supposed to be directly liable and who contributorily
so.Plus, he failed to plead knowledge
and specific conduct that contributed to the infringement—he merely alleged
willful blindness/lack of reasonable care.The judge recommended dismissal; leave to amend should require better
identification of the defendants, their knowledge, and their conduct
contributing to infringement.Similarly,
with vicarious liability, Tovey failed to plead specific facts going to joint
ownership or control. “[V]ague, puffery-like references to a ‘partnership’
between ... [parties are] not enough to support vicarious liability,” and that
was all Tovey had.

Because the federal trademark claims survived, so did the
state ones, along with unjust enrichment.On Tovey’s tortious interference with prospective business
relations/common law conspiracy claims, the judge recommended dismissal for
failure to allege a contract that wasn’t consummated or any concrete business
expectancy that he lost.

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